The Evolution of Jeffrey Sachs

By Robert Cole, AlterNet. Posted May 18, 2005.

President Bush's favorite philosopher Jesus Christ once declared, "The poor we will always have with us." Jeffrey Sachs is a man on a mission to prove him wrong.

The End of Poverty: Economic Possibilities for Our Time is an autobiography, a moral call to arms, and a technical blueprint all rolled up into one massive book dedicated to eradicating extreme global poverty by 2025. Here is what extreme poverty looks like today: over a billion people struggle to survive on less than a dollar a day, while another 1.5 billion exist on less than two dollars per day. Some 114 million children are denied any education whatsoever, even as six million children die of malnutrition before the age of five each year.

Sachs' book is a natural extension of his present tenure as director of both the UN Millennium Project and Columbia University's Earth Institute. In the former position he serves as special advisor to UN Secretary-General Kofi Annan, guiding the pursuit of that project's Millennium Development Goals. These eight MDGs, which are now formally supported by all of UN member states, range from eradicating extreme poverty -- defined as living on less than one dollar per day -- to creating a global partnership for development, with concurrent plans to ensure universal primary education and promote gender equality. (These targets were originally set for 2015, though the eradication of severe poverty has since been pushed back to 2025.)

Miracle Worker or Reckless Visionary?

The high-profile guru of global development, recently included on Time magazine's current list of the world's 100 most influential people, has a long and controversial track record in curing the world's economic woes. Sachs received his Ph.D. from Harvard University when he was barely 26. Within two years, he had already received tenure at Harvard's economics department, where he established his reputation as an expert on international finance and inflation.

Sachs soon became famous as a macroeconomic miracle worker when Bolivia hired him to cure the nation's rampant inflation. Within seven weeks, the good doctor had rescued the ailing Bolivian peso, stopping the country's hyperinflation in its tracks. Sachs never looked back, soon becoming the most sought-after economic adviser to the developing world.

Over the past two decades, Sachs has treated over a hundred such "patients," from Latin America through Eastern Europe to Asia. Along the way, he's garnered a degree of celebrity rare for an economist, rubbing shoulders with popes and presidents, royalty and rock stars. Fame has brought with it greater scrutiny, and inevitably criticism.

After Bolivia, the summer of 1989 found Sachs in post-communist Poland, urging a crash course in market transformation. Heeding a Solidarity leader's request, he and colleague David Lipton held an all-night drafting session that produced a specific timeline of policy reforms, including the immediate removal of price controls and privatization of state enterprises. This tactic of rapidly injecting free-market reforms into stagnant economies came to be known as "shock therapy" (a label Sachs rejects).

Despite warnings from Polish economists who feared that their country lacked the experience to absorb such quick, radical change, the Sachs-Lipton brief became the nation's official economic policy on Jan. 1, 1990 -- and to disastrous effect, at least in the short run. In the absence of government controls, unemployment rates spiked, prices skyrocketed, and thousands lost their personal savings. Poland's woes inspired a firestorm of criticism that Sachs later dismissed, arguing that his strategy did in fact work in the long run. He pointed to the dramatic increase in per capita income by 2002 in Poland, which also enjoyed the highest rate of economic growth among post-communist nations during the same period.

Robert Cole is a freelance writer and historian living on Beaver Island, Michigan.

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